Australia’s tourism boom in China may be over as Chinese tourists choose to stay home

Perth tour guide Phil Dong still showed his Chinese guests the beauty of the city on March 19 last year. What came next surprised him.

The next day, Australia closed its borders to all non-citizens and non-residents in response to the deteriorating COVID-19 situation.

“I never thought it would be the last time I saw tourists from China,” the 39-year-old Chinese migrant who emigrated to Australia two decades ago told ABC.

“I was aware of what was going on on the East Coast, but did not expect COVID to get worse so quickly.”

Sir. Dong, who joined the tourism industry in 2017, said Chinese tourists with large expenditures were the driving force behind Australia’s tourism boom for years.

A tour group for a dessert in Western Australia.
Mr. Dong with a tour group in Pinnacles Desert, Nambung National Park in Western Australia in 2019.(Delivered by: Phil Dong)

“There was a 30 percent increase in our business each year,” he said, adding that he used to host more than 50 week-long tour groups from China each year.

Large users abandon plans to board

Tourism was Australia’s third most valuable export after iron ore and coal pre-pandemic, according to an analysis by the Australian Trade and Investment Commission in 2019.

And China was Australia’s largest incoming tourist market for both arrivals and expenses.

There were more than 1.4 million visitors from China pre-pandemic, which together contributed $ 12 billion to the Australian economy, according to the Department of Trade, Tourism and Investment.

On a clear blue day, you see an Asian woman in bright pink taking a selfie in front of one of the Sydney Opera House sails.
China overtook New Zealand in 2019 to become the largest growth market.(Reuters: David Munoz)

But the constant flow of Chinese tourists was quickly extinguished due to border closures.

While Australia’s borders remain closed to China, long quarantine rules for returning travelers to China and visa restrictions have deterred many holidaymakers.

The Chinese government maintains international aviation capacity at only 2 percent of pre-pandemic levels and advises its citizens not to travel abroad as it adheres to zero tolerance towards COVID-19.

This week, a new report on China’s outbound tourism from the China Tourism Academy, part of the Ministry of Culture and Tourism, shows that a majority of Chinese nationals (83 percent) would only travel to countries with zero new COVID cases and 82 percent of they said they choose to travel domestically instead of abroad in the near future.

In the survey, 72 percent of Chinese said they were reluctant to fly due to safety concerns.

The report also says that there is “great uncertainty” for 2022, and outbound tourism is highly dependent on the containment of the pandemic, despite a 25 percent jump in the number of Chinese outbound tourism this year.

Hong Kong, Macau and Taiwan currently account for over 80 percent of the total outgoing numbers, while Oceania had the largest decline in 2021.

Companies want to see the borders open to China

It leaves a deep prospect for the Australian economy and businesses that depend on Chinese visitors, including those in the Yarra Valley, northeastern Melbourne.

A woman holds a wine bottle in a cellar.
Della Zhang says Chinese customers enjoy Australian wines.(ABC News: Billy Draper)

“We care about tourists from all over the world, and most of them are from China,” Della Zhang, China’s marketing manager at Rochford Wines, told ABC.

“They used to occupy our two 300-seat restaurants almost every day.

“After COVID, because the borders were closed, our international visits went down to zero.”

An empty vineyard.
The Yarra Valley was a must-visit destination for many Chinese holidaymakers.(ABC News: Billy Draper)

She said that although the return of Chinese international students from next month would bring some relief to the company, she wants to see the Australian borders reopened to China completely.

“The feedback was so far [China’s tourism operators] can not wait for our borders to open so they can start advertising for their customers.

“For someone who has never visited Australia, they would have a little bit of security concerns. If we can keep communication open, then continue to promote Australia as a safe and enjoyable destination, it will help a lot.”

‘One of the safest destinations’: Minister of Tourism

The Australian government has recently eased strict travel restrictions by allowing fully vaccinated tourists from Singapore, Japan and South Korea to enter Australia without quarantine.

But there is still no timeline for when tourists from China can return.

Tourism Minister Dan Tehan said the reopening of the borders for vaccinated travelers would comply with the national plan to safely reopen to the world.

“We look forward to welcoming tourists back from all over the world when the Medical Council says it is safe to do so, including from China,” he told ABC.

Tehan said Australia has maintained its market presence in China by engaging with Chinese consumers through traditional marketing channels as well as on social media.

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“Tourism Australia’s trade marketing efforts include hosting this year’s Australian Tourism Exchange with a live event held in Suzhou, China, where more than 200 market travelers met online with Australian tourism product suppliers,” he said.

“Meanwhile, the Aussie Specialist Program continues to train frontline travel salespeople across China to expand their knowledge of Australian products, destinations and people.”

Tourism operators moved on after no business

There is concern that even when international travelers return on a large scale, the industry may not be ready for them right away, as protracted border closures have forced specialized tourism operators like Mr Dong to leave the industry and look for jobs elsewhere.

An empty Sydney Chinatown.
Many businesses that rely on Chinese tourists in the Chinatowns of Sydney and Melbourne are shut down forever.(ABC News: Daniel Irvine)

He said it is a common trend for many Chinese-speaking operators in the sector and many of his other tour guides have moved on.

Now Mr Dong works in construction and said that although he has fond memories of touring Chinese visitors, he does not plan to return to his old job in the foreseeable future.

“I can spend more time with my family now.”

ABC has spoken to several veterans of Chinese Australian travel guides, bus drivers and travel agencies across the states, some of whom have become Uber drivers or real estate agents, others have retired.

“We are not very well equipped to take into account the return of tourists at the moment,” said Simon Chan, president of the Haymarket Chamber of Commerce, which represents traders in Sydney’s Chinatown.

A man is standing in a garden.
Simon Chan says Sydney’s tourist hotspot, the Haymarket area, is still struggling to survive.(ABC News: Daniel Irvine)

“We need to support the companies and encourage them to commit and return to the company to provide the infrastructure to cater for the tourists.”

Research from the Tourism and Transport Forum Australia (TTF) shows that at least 610,000 jobs have been lost since the pandemic hit.

It says that compared to other sectors, more tourism companies have had to let staff go than other companies, and staff shortages are expected to continue far beyond the current operating restrictions.

Margy Osmond, CEO of TTF, told ABC that it is not unique to the Chinese market.

“There are a whole lot of specialized markets where language is a critical issue, as well as an advanced cultural understanding,” she said.

“And in the absence of international travelers over the last few years, it has been a big problem and of course the people who have had to look for work elsewhere because there has been no activity in that area.”

Encourages better bilateral relations and a travel bubble

Despite some progress at home with the Therapeutic Goods Administration (TGA), which recognizes two Chinese-made vaccines for travel to Australia, the frost-clear bilateral relations between the two countries made it difficult for top executives to conduct high-level dialogues on trade and tourism.

Relations between Australia and China have deteriorated sharply in the last few years, with Beijing targeting several Australian goods with trade sanctions and even issuing travel warnings to its citizens not to visit Australia.

It cuts deep for Justin Steele, who runs a small business, AussieYou Tours, in Sydney.

The Queenslander grew up studying Chinese language and culture and was once awarded a scholarship to China to enhance the cultural exchange among young Australians.

A man is standing in an alley.
Justin Steele says he hopes diplomatic tensions can ease soon.(ABC News: Daniel Irvine)

He started his business with bilingual tours focusing on Australian culture in 2018, which attracted many young Chinese millennial tourists.

“They wanted to do something that their parents’ generation would not do,” the 32-year-old told ABC.

“I was really excited about 2020, and the first few months of the year looked really good, and then everything just stopped.”

He said he hopes a travel bubble can open soon due to high vaccination rates in both countries.

“Despite all that politics and that kind of thing, Australians still have this reputation as being very friendly, welcoming people.

“I think Chinese tourists will return if it is in the same number as pre-pandemic, I’m not sure, let’s hope.

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